Africa-Press – South-Africa. Some economists haven’t completely written off a 50-basis point cut when the South Africa Reserve Bank (SARB)’s Monetary Policy Committee (MPC) announces its decision on the repo rate on Thursday.
The MPC met this week to deliberate on policy rates.
Thursday’s announcement comes a day after inflation dropped to 4.4% in August, from 4.6% the month before.
While FNB senior economist Koketso Mano expects the MPC to tread lightly, she said the central bank could swing higher.
“So maybe the MPC remains cautious, and you get a 25-basis point cut, but let me speak about the 50-basis point call, which we think is not completely off the books. It is something that we think could happen if the MPC decides to frontload the cutting cycle more than what we anticipate, so it is a possibility.”
However, Mano warned that inflation expectations are still a concern.
“There’s a higher probability now that you’ll probably get a frontloaded interest rate cutting cycle, but the magnitude is going to be dampened by the fact that the second half of 2025 inflation dynamics are not as positive.”
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